Trove of Data, Touch of Flair, Best Ways to Win the CFO Over
Your procurement department is ready to capitalize on the efficiencies and revenue potential of digital spend management. Is your CFO?
Exploring ways to get the CFO on board was the subject of a spirited discussion at the C-level panel led by Coupa’s Executive Strategic Advisor Kendra Von Esh at Coupa Inspire this spring.
Two finance executives, Ron Pachura (VP Finance Transformation for Fiserv) and Todd Dooley (VP of Finance at H&R Block) were on hand to speak to the finance point of view. Both companies are Coupa customers.
Dooley and Pachura agreed that while recognizing the need to capitalize on the efficiencies and revenue potential provided by the cloud was apparent to most CPOs, persuading the CFO to invest was definitely a challenge.
Von Esh cited a study in which only 50 percent of CFOs surveyed felt the shift to digital was strategically important to the company. The panelists agreed that inspiring more CFOs to embrace the digital opportunity involved due diligence, a trove of data, a touch of marketing flair, and a healthy dose of patience thrown in for good measure.
Focus on the Big Picture
If you do all of that, getting buy-in may not be as difficult as the statistics suggest. As Pachura put it, “CFO’s don’t want legacy costs. They want to pay as they go. And they want something that’s managed for them on the company’s behalf.”
To start with, look outside procurement and focus on the bigger picture, as seen by the CFO. “At the end of the day, a CFO’s job is to drive enterprise value,” Dooley, a former CFO, pointed out. “They are looking at how to invest smarter and faster, and deliver better value to the business.”
Use statistics to help you make the case. For example, Von Esh pointed to a study that found that of companies that recorded EBITDA growth of 10 percent or greater, 50 percent were companies whose CFOs made transitioning IT to the digital world a priority, compared with 34 percent for those continuing to rely on older legacy systems.
Create an Elevator Pitch
Dooley underscored the importance of finding a way to pique the CFO’s interest. “Focus on the two or three things that drive value, then figure out the best way to capture his or her attention.” He proposed an elevator pitch-style approach: “What if I told you I could save $120 million in 18 months?”
“You’d have my attention,” quipped Pachura. “Working capital is certainly an area you can use to grab a CFO’s attention,”
Say it With Facts
Pachura made the point that finance people are skeptical by nature, and that the best way to overcome their skepticism was with a steady diet of facts. “The more relevant facts and figures you are able to provide, the more comfortable your CFO is liable to become.”
Dooley wholeheartedly agreed. “It takes more than a great story to get people over the hump. Your pitch needs to be compelling but it also needs to be fact-based.”
And no matter how compelling your pitch, ultimately it’s about you. “CFOs don’t invest in ideas,” Dooley explained. “They invest in people. It’s important that they grasp the concept, sure, but what they’re investing in is you as the leader.”
Two Panelists, Two Pathways
Pachura and Dooley shared insights from their own journey to cloud-based spend management solutions. “Ours might have been a little bit easy,” Pachura said, since Fiserv has been pursuing an aggressive growth-by-acquisition strategy. “As you can imagine, after one or two acquisitions, we had an overflow of accounting, procuring, and IT functions. As we began to realize those inefficiencies, the natural tendency was to ask, ‘how can we pool our resources and centralize those activities across our organization. Coupa was the obvious answer.’”
For Dooley’s part, “The challenge was to demonstrate credibility. It was about delivering a better user experience, a platform solution that employees actually enjoyed using. It was about establishing a procurement tool that allowed for greater agility, and a more modern experience for Block’s 10,000 offices. We didn’t push the economics angle. We made it an operations decision, not a financial one.”
One of the biggest challenges CPOs face is understanding that persuasion is a process. What seems obvious and urgent to procurement may seem less so to others who have different priorities. The key is to strike a balance between patience and persistence.
“I used to get really frustrated when people couldn’t see the bigger picture,” Dooley said, “I’ve had to learn how to slow down and articulate the vision.”
Pachura agreed, but also suggested it was incumbent upon CPOs to press for transformation. “If you’re on the procurement side,” he said, “I think you have an obligation to think outside the current constraints of the company.”